Martin Lewis Urges Savers to Lock in Fixed Rates Before They Drop Further

Martin Lewis has issued a timely warning to UK savers, urging them to consider locking in fixed-rate savings accounts now before interest rates decline further. As major banks begin slashing savings rates in response to the Bank of England’s recent base rate cut, households could soon see reduced returns on their cash.

The financial expert and TV presenter cautioned that the current fixed-rate deals may soon disappear, making it an ideal moment for savers to secure higher rates. “The Bank of England cut the UK base rate from 4.5% to 4.25%, and this could be a tipping point for savers,” Lewis said.

He explained that fixed-rate accounts are not directly tied to current base rates but are influenced by long-term expectations. “Fixed rates are set based on long-term views of interest rates. The rate new fixes are offered at tends to move, in simple terms, with the market’s long-term view of interest rates, not current UK base rates (as variable savings do).”

Lewis warned that analysts are predicting further base rate reductions over the next 12 to 18 months, with projections suggesting rates could fall to between 3.25% and 3.5% by the end of 2025, and possibly as low as 2.75% in early 2026, told Birmingham Mail.

“That means the current top fixed rates are higher than where the UK base rate is predicted to go,” he noted. “If those predictions do come true, today’s 4.5% fixes may rapidly end up paying more than top future easy-access rates (plus they give the boon of certainty).”

He continued, “So if you’re concerned, the safest option, based on the mood music, is to lock in a rate by putting some savings in fixes. That’s not me saying it’ll definitely be a win, just that it’s a strong risk-averse option.”

Lewis also named his current top one-year fixed savings accounts: Conister (4.52%), Cynergy (4.5%), and Virgin Money as the best big-name option at 4.31%.

For savers looking to shelter their money from tax, he highlighted the best fixed-rate cash ISAs: Santander and Vida, both at 4.25%, with Virgin Money again leading among major names at 4.1%.

With institutions like Nationwide already announcing rate cuts beginning in June, Lewis’s advice comes as a timely alert for savers looking to make the most of their money before rates potentially decline further.